Bitcoin Surges Past $90,000 as Traders Position for New Year Bounce

Bitcoin climbed sharply during Asian trading hours, pushing back above the $90,000 mark and raising the prospect of a fresh breakout after missing out on the traditional year-end “Santa rally” that lifted global equities to record levels.

‍

The world’s largest cryptocurrency advanced as much as 3.1% to trade above $90,200 in Singapore on Monday, according to data. The rebound was broad-based across digital assets, with Ether jumping as much as 4% to reclaim the $3,000 level. The move marked one of Bitcoin’s strongest sessions in weeks and stood in contrast to its relatively muted performance during the equity market’s late-December surge.

‍

While US stocks powered higher in the lead-up to Christmas with the S&P 500 closing at record highs Bitcoin largely moved sideways. The broader crypto market has struggled to regain momentum following a prolonged selloff that began in October. That downturn was triggered by the unwinding of roughly $19 billion in leveraged positions, an event that drained liquidity and dampened risk appetite across the sector.

‍

The liquidation wave left a noticeable mark on market sentiment. Since then, traders have been hesitant to re-enter aggressively, wary of renewed volatility and further downside risk. As a result, crypto prices lagged traditional assets even as optimism returned to global markets toward year-end.

‍

Now, however, there are early signs that sentiment may be starting to shift. Monday’s rally suggests renewed interest among market participants, particularly on the derivatives side.

‍

“This move appears to be partly driven by short-term retail traders increasing their exposure through futures,” said Sebastian Bea, chief investment officer at ReserveOne Inc., a crypto treasury firm. His comments point to a growing willingness among smaller investors to position for upside after weeks of caution.

‍

One indicator reinforcing that view is Bitcoin’s funding rate a widely watched measure of sentiment in the perpetual futures market. According to data from CryptoQuant, the funding rate has climbed to its highest level since Oct. 18, signaling stronger demand for long positions and a pickup in bullish positioning.

‍

At the same time, open interest in Bitcoin futures has rebounded from recent lows, suggesting that traders are gradually rebuilding exposure. However, Bea noted that futures positioning remains well below levels seen during Bitcoin’s previous rally. Open interest is still far from the peaks that coincided with the cryptocurrency’s surge to record highs in October.

‍

Bitcoin reached an all-time high of $126,251 on Oct. 6, capping a powerful rally fueled by optimism around institutional adoption, improving regulatory clarity, and expectations of a more favorable policy environment in the US. Since then, the pullback has been notable, underscoring how quickly sentiment can turn in the digital-asset space.

‍

Despite a series of tailwinds including increased institutional involvement and several policy developments viewed as favorable to crypto under President Donald Trump Bitcoin is down about 4% so far in 2025. That underperformance relative to equities has frustrated some investors, especially as traditional markets benefited from easing inflation pressures and expectations of future interest-rate cuts.

‍

Still, many market participants see the recent stabilization as constructive rather than concerning. After a sharp correction driven by excessive leverage, a period of consolidation is often viewed as necessary to reset positioning and rebuild a healthier foundation for the next leg higher.

‍

From a macro perspective, expectations that the Federal Reserve will continue cutting interest rates into 2026 could also prove supportive for cryptocurrencies. Lower borrowing costs tend to boost appetite for risk assets, particularly those like Bitcoin that are often positioned as alternatives to traditional financial instruments.

‍

The return of retail participation, rising funding rates, and recovering futures activity suggest that Bitcoin may be entering a new phase after weeks of stagnation. However, analysts caution that a sustained rally will likely require broader participation, stronger spot demand, and confirmation from institutional flows.

‍

For now, Bitcoin’s move above $90,000 is an important psychological milestone. Whether it marks the start of a more durable recovery or merely a short-term bounce remains to be seen. Investors will be watching closely to see if momentum can build in the coming weeks especially as liquidity improves and markets shift focus from year-end positioning to the outlook for 2026.

‍

As the crypto market heads into the new year, the key question is whether Bitcoin can finally rejoin the broader risk rally that has defined recent months or if caution will continue to dominate after one of the most volatile periods in its history.

‍